The Green Economy presents a big opportunity

The transformation goes far beyond policy. Cities, global companies, financial institutions and investors already recognize that climate change is not only an environmental problem but a business one. Addressing climate change means avoiding risks but also means new opportunities for growth. Larry Fink, the largest investor in the world, directly asked S&P 500 companies to incorporate environmental, social and governance strategies into their investment process if they want his support. The Financial Stability Board’s climate change task force, which includes Michael Bloomberg and Mark Carney, recommended that all financial institutions assess and disclose climate risk; the market value of companies agreeing reached $7.1 trillion.

All of this looks promising for Canada’s cleantech sector which ranks fourth in the world. Two Canadian cleantech clusters that share a strong presence in Vancouver are driving this global ranking. The Canadian green buildings sector created $23.45 billion in GDP and 297,890 jobs in 2014, and the hydrogen and fuel cell sector generated $220 million in revenue and 1,785 jobs in 2015. In addition, the Province of British Columbia’s (B.C.) carbon tax and a requirement for all public operations to be carbon neutral have led to major investments in building upgrades and the creation of a robust carbon offsets market.

In Vancouver, a vibrant green economy employs one in 15 Vancouverites – up from one in 20 just four years ago, while 30 percent of businesses deliver products or services that help to restore or preserve the environment. Vancouver’s reputation as a clean and green leader drives a brand valued at $31.5 billion, and the economy grew faster than any other city in Canada from 2010 to 2017. All this while carbon emissions declined by 11 percent, resulting in the carbon intensity of our GDP (tonnes GHGs per dollar of GDP) decreasing by 30 percent.

Vancouver’s reputation as a clean and green leader drives a brand valued at $31.5 B

Three ingredients: policy, innovation, demand

From the founding of Greenpeace to the concept of the ecological footprint and the advent of the 100-mile diet, Vancouver has long been a source for disruptive innovation in response to climate change. Over the decades, Vancouver has pioneered policies that have made the city stand apart on issues of environment, social cohesion and economic inclusion. Vancouverites chose liveability over car-centric urban planning approaches in the 1960s, and today, it is one of the only North American centres without an innercity freeway. The city’s building code is the greenest of any jurisdiction in the world. And recent citywide plans put Vancouver on a path to be 100 percent powered by renewable energy, produce zero waste, make the majority of trips by foot, bike or transit and be a place where everyone has a home.

Vancouver’s most enviable innovations have found a supportive policy environment, but they have also been championed by progressive thinkers with some of the world’s most entrepreneurial mindsets. Recognized as one of the world’s top startup ecosystems, Vancouver is home to numerous game-changing technologies including General Fusion (world leader in commercial fusion energy) and Carbon Engineering (carbon capture and synthesis of transportation fuel). Disciplines can collide and collaborate in this interconnected ecosystem, allowing for solutions to flourish that transcend existing definitions of industry sectors.

Virtual and augmented reality experts provide holograms and immersive experiences for real estate developers to visualize design blueprints and analyze materials ordering before construction even begins. This allows for fewer wasted materials and more efficient construction practices. A generation of cleantech engineers and technicians are using desalination and other techniques to upend age-old polluting industries like mining, and remove contaminants from tailings and wastewater. Machine learning expertise is aiding in the creation of smart grid solutions where tens or thousands of individual energy sources can be networked together to create virtual power plants.

The ultimate driver for green solutions is demand. Policy can drive demand; all new buildings in Vancouver must be zero emissions by 2030 and B.C. has set out a pathway to net-zero-ready buildings by 2032. Constructing new buildings to meet these rigorous requirements will drive demand for high performance building technologies including triple-glazed windows, thermal bridging solutions, and all manner of heat pumps. But demand is also driven by a consumer mindset in Vancouver that values environmental protection. Consumers want an emotional connection and sense of shared values with the brands they buy. A third of British Columbians want their next car to be an electric vehicle and 8.5 percent are vegetarian (4 percent are vegan). Nearly 10 percent of Vancouver businesses want to become zero waste and more than a third are diverting waste streams that are not even regulated yet. Mountain Equipment Co-op is ranked the most reputable company in Canada due in large part to having social and environmental responsibility at its core. This is the company that proactively decided to stop selling products from Vista Outdoor, a U.S. company that produces guns and ammunition.

There is a long road ahead

Although we are celebrating 2018, there is still a lot more work to be done.

With more than a million people expected to call Vancouver home in the next two decades, the region needs a growth strategy that will provide good jobs, efficient urban infrastructure and a resilient economy. In particular, we need to develop responsive, smart and distributed infrastructure; implement aggressive social and environmental policies; and make wise investments in capital projects, people, and places that will improve the diversity, equity, and sustainability of our economy over the long run.

Energy infrastructure

B.C. recently greenlit the Site C Dam, a renewable energy megaproject, expanding the province’s reliance on large-scale hydro projects to power a growing population. This project will have a heavy impact on ecosystems and will suffer from large power losses associated with transmission over long distances.

Locking into this centralized system could preclude more efficient and resilient solutions such as distributed and district-scale generation that provide flexible, modular and more responsive systems, located closer to areas of high energy demand.

The government of Canada has bought Kinder Morgan’s Trans Mountain bitumen pipeline for $4.5 billion to ensure that 890,000 barrels of Alberta bitumen per day can be pumped to Canada’s west coast and ultimately shipped to global markets. In light of the rapid global shift away from fossil fuels and toward renewable resources and the circular economy, this pipeline would create just 50 permanent jobs and has the potential to quickly become a ‘stranded asset’– a risky investment considering even the World Bank has declared it would no longer fund oil and gas exploration.

In the meantime, critical pieces of infrastructure and policy required for a smart energy or transportation system are still missing in B.C. Unlike most jurisdictions in the world, B.C. has been removing rather than installing smart meters after a roll out program plagued first by health and privacy concerns, then by faulty or substandard meters. Smart meters are one of the first steps in establishing a smart grid.

Real estate affordability

B.C.’s economy is more dependent on real estate and construction than any other province in the country. Real estate and construction make up nearly 15 percent of B.C.’s economic activity – that’s more than the Province of Alberta depends on fossil fuels. Snow washing, ghost immigrants, shadow flipping and speculation have all contributed to an affordability crisis where housing and even commercial and industrial spaces are becoming inaccessible putting pressure on residents and also startups, innovators and small business. In addition to addressing the rampant corruption and opacity in housing markets fuelling a global affordability crisis, economic development efforts that focus on ensuring Vancouverites are experts at thinking, creating and solving in addition to building will improve the diversity – therefore resilience – of our economy.

Transportation

The last few years have seen huge leaps in clean transportation. Vancouver is hailed as ‘ride sharing capital of the world’ and the city operates the largest municipal electric vehicle fleet in Canada. Connected, smart cars have the ability to reduce energy consumption through efficient driving and improved performance, and projections suggest that full autonomous vehicles will be on the roads by 2025. Yet B.C. has not allowed autonomous vehicles to be tested on the roads, and ride-hailing services like Uber and Lyft are not yet available locally. While the legal and social implications of these technologies are wide-ranging and complex, we cannot afford to ignore them. Resources need to be dedicated to developing effective, thoughtful policies that both enable innovation and protect the safety and security of citizens.

Come join us

We know that solving these challenges is possible with collaboration. At the Vancouver Economic Commission, we develop relationships with investors to help attract the right kind of patient capital; we help local cleantech companies access global markets to realize their full export potential; and we have been leveraging our own city assets and infrastructure to stimulate the early deployment of locally developed green technology.

In this report we share with you data about our green economy while highlighting the movers and shakers that are bringing about transformation. We welcome you to learn about the Vancouver advantage, and what makes us a unique ecosystem for green business and a green economy. We thank those of you already playing a role in Vancouver’s acceleration towards a greener, resilient future and we welcome the rest of you to come work with us in the near future.

Juvarya Veltkamp, Lead Writer

Juvarya Veltkamp, Manager, Green Economy Initiatives, is a Green Economy practitioner, focused on progressive and sustainable approaches to economic development and business. With specific expertise in green buildings, clean technology and local food, Juvarya loves to create pragmatic solutions that address the triple bottom line of people, planet and profit.

Want to learn more about trends, leaders and innovative solutions in our sustainability ecosystem? The State of Vancouver’s Green Economy 2018 report features more than 200 leaders driving the transition to a low-carbon, resilient economy. Read the full report.